BUA Blames High Cement Prices on Middlemen 

Abdul Samad Rabiu-Founder of BUA Group

The Chairman of BUA Cement, Abdul Samad Rabiu, has attributed the rising cost of cement in Nigeria to the actions of middlemen who are taking advantage of consumers. Despite BUA Cement’s efforts to maintain a low price, dealers are selling cement at much higher rates. 

Price Manipulation by Middlemen 

At BUA Cement’s recent Annual General Meeting in Abuja, Rabiu revealed that in 2023, the company sold over a million tonnes of cement to dealers at a price of N3,500 per bag. However, instead of passing on the benefits to consumers, these middlemen sold the cement at inflated prices, sometimes as high as N7,000 to N8,000 per bag. Rabiu explained that BUA’s intention was to make cement affordable to Nigerians, particularly to help address the country’s housing deficit. But the middlemen’s actions have hindered these efforts, contributing to the surge in cement prices. 

Housing Affordability in Crisis 

Nigeria has long struggled with a lack of affordable housing, with over 28 million Nigerians lacking access to decent homes, according to the International Human Rights Commission. The rising cost of building materials, including cement, is a significant factor. In just a year, cement prices rose from N4,300 per bag in May 2023 to between N7,500 and N8,000 per bag in May 2024. This price increase is putting more pressure on Nigerians already dealing with high rental costs, forcing some to live in substandard housing due to the unaffordability of new homes. 

The actions of middlemen are driving up cement prices, putting affordable housing out of reach for many Nigerians and deepening the housing crisis.

The Impact on Construction 

Experts in the construction industry are concerned that the rising cost of materials will lead to even higher housing costs. Adekunle Ebenezer, a quantity surveyor at Anchor University, Lagos, noted that building materials account for 50-65% of construction costs. He warned that the price hikes in cement and other materials would inevitably push developers to raise the prices of houses and rentals. 

BUA’s Response 

Rabiu emphasized that BUA Cement had no control over the prices set by middlemen. He further explained that due to factors like the devaluation of the naira and the removal of fuel subsidies, BUA had to discontinue its low-price policy. The company could not continue to sell cement at a loss while middlemen profited. 

The exploitation of consumers by middlemen is driving up cement prices in Nigeria, making housing even more unaffordable. As construction costs rise, the impact will be felt across the housing sector, leading to a growing crisis in the availability of decent, affordable homes.